Italy's Enel draws interest for its sale of Russian coal plant

MOSCOW (Reuters) - Italy’s Enel (ENEI.MI) (ENRU.MM), which has mandated Sberbank (SBER.MM) to find buyers for its Reftinskaya coal power plant in Russia, has received interest from potential buyers including from outside of Russia, Enel Russia’s CEO said on Thursday.

Enel, one of several foreign companies that bought into the Russian power sector after the state monopoly was broken up in the past decade, is selling the Reftinskaya plant to switch its Russian focus to wind energy.

“We are working at this deal ... We see that the interest we were counting on is there ... I can’t give names but there are foreign names showing interest,” Enel’s Russia chief Carlo Palasciano said at the Reuters Russian Investment Summit in Moscow.

As part of its global switch from coal to renewables, Enel this year won the right to build two wind farms in Russia with total capacity of about 300 megawatts. The company plans to invest 405 million euros ($483 million) in the project, which is expected to be operational in the early 2020s. [nL8N1D4A51]

“Key investments are in 2018-2019, a bit in 2020,” Palasciano said, adding that it is looking at the Russian financial market for funding options.

Renewables so far represent only a tiny fraction of the energy sector in Russia, the world’s top energy producer and exporter. Russia aims to lift the share to 5.5 gigawatts (GW), or 4.5 percent, by 2024 through the addition of 3.4 GW from its wind farms.

“This is a small revolution ... The wind power would give a push for the creation of a new industry (in Russia) ... We are not stopping and will look further (for new opportunities),” Palasciano said.

Enel Russia has agreed on a partnership with German engineering group Siemens (SIEGn.DE) to provide support for local equipment production for the wind farms. [nFWN1JC07C]

Asked whether the recent scandal around Siemens turbines being shipped to Crimea had affected cooperation between the companies, Palasciano said there was nothing for Enel to be concerned about.

“We have Siemens blocks (equipment), we have a service contract (with Siemens)... We don’t have any fears that this story could affect us,” he said, adding that Siemens has made it clear that it will stop supplying equipment to Russian state companies.

Last month a Moscow court rejected a request by Siemens to ban the installation of Siemens gas turbines that turned up in Crimea contrary to EU sanctions.